Item 1.01 Entry into a Material Definitive Agreement.
OnDecember 22, 2021 (the "Effective Date"),Energy Recovery, Inc. (the "Company") entered into a Credit Agreement (the "Agreement") betweenJPMorgan Chase Bank, N.A ., a national banking association as lender and the Company as borrower. The Agreement provides for a total available credit line of$50.0 million . Under the Agreement, the Company is allowed to draw advances not to exceed, at any time,$50.0 million as revolving loans. The total Letters of Credit issued under the Agreement may not exceed the lesser of the$25.0 million credit line or the credit line minus all outstanding revolving loans. At no time may the aggregate of the revolving loans and letters of credit exceed the total available credit line of$50.0 million . On the Effective Date, in connection with entering into the Agreement, the Company terminated its existing Loan and Pledge Agreement dated as ofJanuary 27, 2017 , withCitibank N.A . The Agreement is subject to the customary affirmative and negative covenants for a credit facility of this type, including limitations on the Company with respect to liens, indebtedness, investments, and dispositions of assets. Revolving loans under the Credit Agreement may be in the form of 1) a base rate loan that bears interest equal to (a) the greater of theWall Street Journal prime rate and (b) the sum of (i) one-month reserve adjusted LIBOR and (ii) 2.50%, plus an applicable margin of 0.25% or 0.50%, subject to the Company's total leverage ratio, or 2) a Eurodollar loan that bears interest equal to the sum of the reserved adjusted LIBOR rate for an interest period elected by the Company, plus an applicable margin of 1.25% or 1.50%, based upon the Company's total leverage ratio. The Agreement matures onDecember 21, 2026 and is collateralized by substantially all of the Company's assets. The above description in this Current Report is not intended to be a complete description of the Agreement. The full text of the Agreement is attached as Exhibit 10.1 to this Current Report.
Item 1.02 Termination of a Material Definitive Agreement.
The information provided in Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off Balance Sheet Arrangement of a Registrant.
The information provided in Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits Exhibit Number Description 10.1 Credit Agreement Between JP Morgan Chase Bank, N.A. and Energy Recovery, Inc. dated December 22, 2021 104 Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document
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